Forget peace, go for pace

Business litigants are more eager to speed up the legal process than to make it less bloody. By Grania Langdon-Down What do business clients think of Lord Woolf's proposed legal reforms? By Grania Langdon-Down
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The Independent Online
How do you encourage opposing sides in heavyweight corporate litigation to adopt a new spirit of co-operation with the spectre of a bloody courtroom battle hanging over them? A central ethos of Lord Woolf's reforms of the civil justice system is to end the "aggressive posturing" that has become the norm in big commercial cases.

But even if lawyers take his plea on board, the key to its success will be getting clients to see it in the same way, says Kevin Perry, national head of litigation at Pinsent Curtis.

"Since litigation can become very unpleasant, achieving that spirit of co-operation almost calls for a change in human nature," he says.

Pinsent Curtis, one of the biggest law firms in the country, with offices in London, Leeds and Birmingham, has just conducted a survey of the views of 500 business clients and target clients on Lord Woolf's "access to justice" reforms.

Mr Perry says the proposals are radical, yet consultation has largely been contained within the legal profession and it is very important to give the "end users" of the litigation process a chance to have their say.

The survey, thought to be the most extensive carried out among business clients, was sent to large public companies, private companies, banks, building societies and institutions.

More than 80 per cent said they had been involved in litigation in the past three years, with half of their cases going to trial. Their experience showed an even split between winners, losers and those who "drew". Two- thirds admitted to avoiding litigation - even if they had a good claim - to protect a commercial relationship.

Lord Woolf, recently appointed Master of the Rolls, is due to publish his final report recommending measures to reduce the cost, complexity and delays associated with civil litigation on 26 July after a two-year inquiry.

Key reforms set out in his interim report include judges becoming case managers and directing the pace of a hearing, court-appointed experts, limits on discovery, fixed costs and increased use of information technology to back up a new high-speed approach to litigation.

Mr Perry says the survey findings, which have been sent to Lord Woolf, show broad support for the pace of litigation to be pushed along by the court, with two-thirds of respondents wanting a result irrespective of the "fine detail" of the dispute.

"But, however interventionist the judge becomes, you still end up with a plaintiff suing a defendant and trying to win," he says.

"Businesses remain sceptical about mediation and ADR [alternative dispute resolution]. Some cases involve what the clients see as an important point of principle and they want their day in court to win and be seen to win.

"It will be quite difficult in my view to get clients to buy into this new spirit of co-operation in the early and middle stages of an action, knowing it is all going to get bloody at the end of the day with the trial."

Lord Woolf has also proposed that the behaviour of the parties during the whole case, even before proceedings have been issued, should be considered when the court exercises its discretion over costs. "Having that spectre hanging over your shoulder throughout any negotiations, including pre- litigation negotiations, will be quite a hard thing for the business community to swallow," Mr Perry believes.

The survey findings include:

Expert witnesses: more than 80 per cent of respondents said they would still choose to appoint their own experts, even if there was no chance of recovering the cost if they won;

Discovery: while just over half believed a more restricted discovery obligation would improve commercial litigation, 65 per cent believed the step would increase the risk of injustice;

Mediation: nearly two-thirds said they had never used mediation; 61 per cent said mediation should not be a prerequisite of proceedings being issued, although 65 per cent believed it should be attempted before going to trial;

Technology: only 14 per cent had been in courts where computers were used and, of those, there was an even split between those who believed IT had helped speed up the process and those who believed it had encouraged the proliferation of documentary evidence.

Lord Woolf does not deal with the use of contingency fees, but Pinsent Curtis asked respondents whether they would favour their introduction in commercial disputes.

Just over half were in favour, with 44 per cent against. Some 57 per cent believed there would be risks involved because it could encourage people to "take a punt" at a company knowing that their liability in costs would be restricted even if they did lose.

Mr Perry says the survey posed serious questions for lawyers. "It shows that the business community is, in effect, prepared to cut corners over such things as discovery to make the process less unwieldy and costly.

"But that is potentially an alien concept to litigation lawyers brought up on getting their hands on every piece of paper that could conceivably be relevant to the issue."

Unsurprisingly, a resounding 96 per cent of the survey respondents were in favour of winners continuing to have their costs paid. However, just over half were against costs being limited.

"One of the great concerns of our clients is that, even if they have been sued quite wrongly in a large-scale piece of litigation, they can still end up hundreds of thousands of pounds out of pocket because of the taxation rules," Mr Perry says.

He is now waiting with interest to see how the main political parties react to Lord Woolf's report, especially with an election not far away.

"For Lord Woolf's reforms to be successful, they need to be implemented as a whole," Mr Perry says. "Financial resources are the key to much of what is proposed and it is politicians rather than lawyers or business who have control of the purse-strings. The scale and pace of change will be determined by political will. Perhaps the recent appointment of Lord Woolf as Master of the Rolls will be a critical factor in achieving change."